In the absence of government or employer-sponsored health insurance, which of the following would be true about health expenses for the elderly?
A. The elderly would have to pay for health care expenses out of their current income.
B. It would not be financially worthwhile for the elderly to purchase insurance to cover medical expenses.
C. Insurance companies would earn greater profits on health insurance for the elderly.
D. The elderly would only need to worry about catastrophic health events.
Answer: B
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Which of the following information about fiat money is false? Fiat money
A) has little to no value except as money. B) serves as a medium of exchange. C) is backed by gold. D) is authorized by a central bank or governmental body.
Which of the following is NOT a government response to asymmetric information?
A) liability laws B) social regulation C) manufacturer's warranties D) government licensing
If in a given market of more than one producer, there were to exist for a long interval of time a positive gap between price and average cost (P > AC), this would suggest that
a. there are many sellers in the industry. b. there exists an oligopoly or cartel in the industry. c. this is a contestable market. d. the firm cannot be a monopolistic competitor.
Employers in a city must pay a specific tax of $t per hour worked by their employees while employers in the suburbs of the city do not have an employment tax. What does a general equilibrium approach predict regarding the wages and employment of both the city and suburban workers if the city decides to substantially reduce their employment tax rate?
A) Wages will increase in the city, but not in the suburbs, and employment will increase in both. B) Wages will increase in both the city and the suburbs, but employment will fall in both. C) Wages will increase in both the city and suburbs, employment will increase in the city, but decrease in the suburbs. D) Wages will increase in both the city and the suburbs, employment will decrease in the city, but increase in the suburbs.